Navigating Your First Hire: An Employment Guide for New Small Businesses

Congratulations! Taking the leap to hire your first employee is a massive milestone for any small business. It means you are growing, but it also means you are stepping into the heavily regulated world of UK employment law.

In the UK, significant legal shifts are happening under the Employment Rights Act 2025 and the upcoming rollout of the Plan to Make Work Pay. Navigating these changes can feel overwhelming, but getting your HR foundations right from day one will not only keep you safe from tribunals but will also help you attract and retain top-tier talent.

Here is a step-by-step blueprint on how to approach your very first hire safely, legally, and effectively.

Phase 1: Attracting the Right Talent

1. Write a Precise Job Description

A good job description manages expectations from the start. Outline the day-to-day responsibilities, required skills, and core working hours. This prevents misunderstandings later on and helps you measure performance during probation.

2. Guard Against Indirect Discrimination

When writing adverts, be mindful of your wording. Avoid terms that could inadvertently exclude certain groups (e.g., asking for a “highly energetic digital native” could be perceived as age discrimination). Focus strictly on the objective skills required for the role.

3. Establish Clear Salary and Benefits

Be transparent about pay. Remember that from April 2026, National Minimum Wage rates have increased, so ensure your offering complies with the latest statutory rates. Offering a competitive rate alongside small business perks (like true flexibility) is your best weapon against larger corporate competitors.

Once you have found your ideal candidate, the legal clock starts ticking. The UK compliance baseline has become much stricter over recent years, meaning onboarding must be treated as a rigorous legal control rather than an administrative afterthought.

1. The Day-One Written Statement of Particulars

Under rules embedded into UK law, you must provide your new hire with a Written Statement of Particulars on or before their very first day of work. You can no longer wait two months to issue a contract.

If you fail to provide this and a dispute arises later, an employment tribunal can award the worker an additional two to four weeks’ pay solely for this administrative failure.

HR Good Practice Note: Ensure your staff handbook and core employment contract align perfectly. While core terms must be given on day one, supplementary procedures (like detailed grievance steps) can be placed in an accessible staff handbook.

2. Mandatory Contract Clauses to Include

Your template employment contract needs to be legally robust. Ensure it features:

• A Clear Probationary Period: Typically 3 to 6 months. This is vital because from 1 January 2027, ordinary unfair dismissal protection becomes a day-one right capped at a 6-month qualifying period. You must use the initial months to rigorously assess suitability.
• Correct Sickness Pay Terms: State how Statutory Sick Pay (SSP) works. Note that from 6 April 2026, SSP is a day-one right; the old three-day waiting period and the Lower Earnings Limit have been completely abolished.
• Holiday Entitlement & Tracking: Specify the statutory minimum holiday (5.6 weeks). Crucially, from 6 April 2026, employers face a strict statutory duty to keep adequate holiday and holiday pay records for six years. Failure to keep these records is a criminal offence punishable by unlimited fines.

Getting the right person through the door is only half the battle; keeping them motivated and loyal is what protects your business investment.

1. Foster an Inclusive, Safe Workplace

New rules commencing in October 2026 significantly upgrade an employer’s duty to protect staff. You will be legally required to take “all reasonable steps” to prevent sexual harassment and third-party harassment (from clients, suppliers, or customers). Implementing clear zero-tolerance policies and reporting mechanisms from day one shows your employee that their well-being is a priority.

2. Embrace Balanced Flexible Working

Flexible working is no longer a luxury; it is a key driver for retention. Employees now have the right to request flexible working from their very first day of employment. While you do not have to accept every request, you must handle them reasonably and provide valid statutory business reasons if you refuse.

3. Ensure Payroll Accuracy (Beware the Fair Work Agency!)

The government has launched the Fair Work Agency (FWA). This centralized enforcement body has extensive powers to conduct proactive workplace spot-checks and inspect payroll documents. They are focusing heavily on holiday pay calculations and minimum wage compliance. Mistakes made out of human error or ignorance are not valid legal defences, so utilizing dependable payroll software or an external accountant is highly recommended.

Phase 3: Retaining Your Employee

Getting the right person through the door is only half the battle; keeping them motivated and loyal is what protects your business investment.

1. Foster an Inclusive, Safe Workplace

New rules commencing in October 2026 significantly upgrade an employer’s duty to protect staff. You will be legally required to take “all reasonable steps” to prevent sexual harassment and third-party harassment (from clients, suppliers, or customers). Implementing clear zero-tolerance policies and reporting mechanisms from day one shows your employee that their well-being is a priority.

2. Embrace Balanced Flexible Working

Flexible working is no longer a luxury; it is a key driver for retention. Employees now have the right to request flexible working from their very first day of employment. While you do not have to accept every request, you must handle them reasonably and provide valid statutory business reasons if you refuse.

3. Ensure Payroll Accuracy (Beware the Fair Work Agency!)

The government has launched the Fair Work Agency (FWA). This centralized enforcement body has extensive powers to conduct proactive workplace spot-checks and inspect payroll documents. They are focusing heavily on holiday pay calculations and minimum wage compliance. Mistakes made out of human error or ignorance are not valid legal defences, so utilizing dependable payroll software or an external accountant is highly recomme

The policies on this website are all compliant with these requirements and downloading and using them should ensure your first hiring experience is a rewarding milestone rather than a legal headache.

The post I am a new small business now ready to employ my first member of staff… appeared first on Human Resource Solutions.

As a company we are going through a re structuring process with change of hours and possible redundancies. One of our part-time employees is pregnant and often off sick. It was decided that her specific role will be integrated into an existing full-time manager’s role. Can we still go through the same redundancy process with her or because she is pregnant we have to ‘spare’ her role and review after her maternity leave finishes??   

Under UK law, is unlawful discrimination and automatically unfair dismissal to select a woman for redundancy because she is pregnant or on maternity leave. You therefore must be able to demonstrate a genuine redundancy situation and that any actions you take to make your pregnant employee redundant fits one of these situations:

• the business (or the relevant branch office or site) closes down either temporarily or permanently;
• the business moves and and it is unreasonable to expect the employee to commute or relocate due to the distance
• fewer employees are required because of a reduction in work through restructuring, downsizing, cost cutting or the introduction of new technology

If you are certain you can establish one of these situations then you can use proper redundancy procedures to make the pregnant employee redundant.

Employees who are pregnant or on maternity leave are protected from redundancy. Therefore if another job has been altered to subsume the duties of the post, you must consider whether the pregnant employ could reasonably undertake this new role. If it could be deemed a reasonable alternative, and if she is pregnant or on maternity leave then legally it must be offered to her before anyone else. She will not need to compete in a selection process for this suitable role. This protection period starts as soon as she notifies you of her pregnancy and lasts until 18 months after the baby’s due date (or birth date).

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We are a fairly small organisation and every member of staff has to pull their weight. One person is not doing so, they are basically lazy, often late, disruptive and have a very poor short-term sickness record with lots of individual days off. Given all this is there any reason why I can’t just dismiss them?

No you simply can’t terminate in the way you suggest without running the risk of a finding of unfair dismissal (assuming the individual has at least 2 years service) should you end up at an employment tribunal. You need to ensure you have a fair reason to dismiss. The fair reasons in law for dismissal are:

1. Conduct – if they have broken the terms of their employment through such things as continually missing work, poor discipline or theft / dishonesty.
2. Capability – where they are unable to perform to the required standard for reasons such as inability to deal with new technology, inability to get along with fellow workers, or long-term persistent illness. (However if the long-term illness relates to a disability you have a legal obligation to make ‘reasonable adjustments’ to help the individual to work).
3. Redundancy – where there is no longer any, or enough, work for the employee in your workplace.
4. A Statutory Restriction – you can fairly terminate if continuing to employ would break the law e.g. you employ a driver who loses his licence. You would be expected to look for alternative employment before dismissal.
5. Another Substantial Reason – this is a general catch-all of other reasons – these can be such things as imprisonment of the employee, an unresolvable personality conflict etc. Generally the other reasons for dismissal should not be relied on where possible as it is often more difficult to prove a ‘substantial’ reason.

In the case you refer to, I would suggest you look at going down the conduct route, and so you really need to have an effective disciplinary procedure in place. You will find one on this site. Ensure you properly investigate each episode of misconduct that you identify, and issue warnings as appropriate. These soon mount up, and the individual concerned will either get the message and improve their behaviour, or you will have enough information to safely dismiss them.

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We are a growing and expanding company and as such some of our prwvious policies need to change. We also want to implement some new policies. For example we want to introduce a new social media policy and we want to be sure our staff are fully aware of it . How should we proceed with this and with other policy changes we want to make?

Hopefully you will have somewhere within your contract of employment a statement such as:

“You will be subject to the terms and conditions as agreed and amended from time to time by the the Company as outlined in its policies, procedures, handbooks and other relevant documents..”

On this basis it is perfectly legitimate for you to change / implement policies and procedures. Even if you don’t have such a statement it is still reasonable to implement a new policy as long as it does not conflict with any currently agreed contractual terms and conditions (if it does then you need to agree the change with staff, or utilise a procedure to unilaterally impose this).

You should ensure that when you propose the new policy that you consult with your staff / trade unions about the policy contents and explain why you wish to implement such a policy. Once finalised, you should communicate the policy throughout your organisation using all your main communication channels such as: email, intranet, memo etc. You should also remember to amend your staff handbook if applicable. It is also advisable to let staff know how the policy will be monitored.

Ideally you would want every member of staff to demonstrate that they have read and understood the policy by signing this off (either on paper or electronically) however if they won’t, should it ever be necessary to defend any actions taken under this policy at an Employment Tribunal it should be enough to demonstrate that you have properly and effectively communicated it.

It may also advisable if you think this policy is likely to be contentious, to actually arrange face-to-face familiarisation sessions for all staff so you can be sure they understand the new policy and where you can issue them with a copy. You can also take a register at these sessions and in that way demonstrate that all staff were made fully aware of the policy.

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We run a very busy bar with usually 5 or 6 bar-persons on duty at any one time. We know that money is going missing from the till and we are pretty sure we know who is taking it on the basis of statements from the other staff. I know we need to properly investigate this before we take any disciplinary action, but can we just suspend the individual we suspect and keep him out of the bar until then?

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I have been asked by a former employee to supply them with a reference for a new job in another company and that company has now sent me a fairly lengthy list of questions about my views on the employee. Unfortunately this employee had been a very poor performer – should I reflect this in their reference? If I do is there likely to be any come back on me if the individual doesn’t get the job because of it?

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I have a member of staff who frequently claim they are sick and can’t come to work; this is often on an intermittent basis involving one or two days at a time which is impossible to plan for. On examination, there is a frequently a pattern to this absence which makes it even more exasperating. For example on a Monday following their weekend off, or immediately after a holiday. Can I do anything about this?

Even if there is no obvious pattern, there are staff who frequently take days off sick, and their colleagues are expected to cover for them with all the stresses and strains that entails. In large organisations, this is difficult enough, but in smaller companies, these episodes of sickness can seriously threaten the integrity of the business. So what can you do about this?

Here are the 5 key tips to sort this out:

1. Ensure you have good, accurate and up-to-date information on the sickness record of the individual in question. You should plot their sick time on a calendar or spreadsheet where any patterns will stand out. Then when you come to discuss this with them, there is no ambiguity about the problem.
2. Make sure your company has a policy on dealing with sickness absence which has clear ‘trigger’ points. That is when an individual has a certain number of days off within a certain period, it triggers management action. This usually amounts to the requirement to convene a formal meeting to discuss the individual’s sickness record, and to warn them about the consequences of continued short-term absences. There is an example policy here. It is also a good idea to insist that staff with above a certain number of periods of sickness absence produce a medical certificate from their GP every time they are absent.
3. After every period of sickness, a return-to-work meeting should be held with the individual on the first day back. This confirms to them that management are aware of their sick time, and allows the opportunity to discuss any health problems they may have. Also ensure that the issues discussed, and what is expected of the individual is written down in a letter to the individual, and that this is properly filed on their personnel file.
4. Ensure all managers and supervisors are trained to apply the policy consistently. Once staff realise that the company means business on these sorts of intermittent periods of sickness absences, the number of absences tends to decrease significantly.
5. Individuals who fail to improve their sickness absence record, following appropriate warnings, can be dismissed on the basis of capability – that is they are not able to fulfill their contract of employment because of their sickness absences. Take care that you have followed your procedure carefully, and that you have not discriminated against anyone on the basis of a disability (or indeed any other reason).this demonstrates that you take sickness absence very seriously, and shows staff who have had to bear the increased workload for sick colleagues that you have taken positive action to sort this out.

Often managers in small businesses worry that they cannot take action against individuals who demonstrate frequent intermittent sickness periods. This is not the case. Staff who deliberately take time off claiming to be sick when they really are not, put their colleagues under pressure to cover their duties, and ultimately threaten the success of the company and the livelihood  of all concerned. Application of a suitable sickeness absence policy, clear information on the pattern of absences, and consistent application by managers and supervisors will go a very long way to control and hopefully eradicate this sort of behaviour.

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